N. Sumatra faces problems in solving acute power shortage

N. Sumatra faces problems in solving acute power shortage

Apriadi Gunawan, The Jakarta Post, Medan

A chronic electricity deficit is plaguing North Sumatra province,
with the power deficit estimated to have reached 1,000 megawatts
(MW).

General manager of power generation and distribution for the
state electricity company PT PLN northern Sumatra division,
Albert Pangaribuan, said that the company was still having
difficulties in overcoming the power crisis.

Albert said that so far, PLN will only be able to generate 82
MW of the 1,000 MW deficit from the Lau Renun hydropower station
in Dairi regency, which is slated to start operation in 2005.

Albert explained that besides power provided by Lau Renun, PLN
had also signed agreements with foreign investors to establish
power stations with maximum output of 400 MW each.

One of the projects under construction at the moment is the
Labuhan Angin steam-powered station in Central Tapanuli regency,
in cooperation with Chinese investors.

"Although there are plans to add another 400 MW, we're still
going to be short 600 MW until 2010," explained Albert on the
current electricity situation in North Sumatra to the
Coordinating Minister for the Economy Aburizal Bakrie and PLN
President Director Eddi Widiyono at the Sicanang power station in
Belawan.

Eddi said that the capacity of PLN's power generators was
limited, while new stations were still being built. Due to this,
PLN could not meet customers increasing demands in North Sumatra
and this had prompted PLN to seek cooperation with the private
sector to build new stations.

Based on PLN data, the number of consumers in North Sumatra
had reached more than two million, consisting of household and
industrial clients, and the number keeps growing. If there is no
new investment in power plants, it is feared that the province
will not be able to meet new demand, he said.

Eddi said that he had noticed that private parties that had
signed agreements with PLN were still having problems in
financing the projects, causing many projects, such as the one in
Sibolga, to be stalled.

According to Eddi, PLN has encouraged foreign investors to
build new power stations in Indonesia, including in North
Sumatra.

"Now with Government Regulation No. 3, and Ministerial
Regulation No. 9 and No. 10 to regulate joint-ventures with
private parties, if they can follow the guidelines, we'll welcome
them," said Eddi.

Eddi said that besides facing power generating problems, PLN
was also having problems in meeting coal, oil and gas supplies.
He added that PLN's performance had been severely affected by the
drop in fuel supplies to power stations.

"It's not due to Pertamina's mistakes, but looking at the high
price of fuel at this moment, we realize that fossil fuels will
be scarce in the future," he said, while encouraging people to
save electricity, considering the soaring price of fuels now.

In response to the continuing power crisis in North Sumatra,
Coordinating Minister for the Economy Aburizal Bakrie had urged
PLN to seek as many investors as possible to build power
stations.

"Invite foreign and local private companies to immediately
construct power generating stations here. If there is more than
one party, then put the projects out on tender," said Aburizal,
while promising to streamline bureaucracy.

In relation to the scarcity and high cost of fuels, Aburizal
urged PLN to use coal and gas in its future plans.